The Budget 2012 Review: For the Richer or for the Poorer?

In 1947, whilst Chancellor of the Exchequer Hugh Dalton was on his way to deliver his annual budget in the Commons, he made a brief stop to chat to a journalist. In this conversation, he disclosed a few quotes and statistics he was just about to announce. The journalist- John Carvel- got to work fast, and managed to publish the scoop before Dalton announced it himself in an evening paper. It doesn't sound shocking when compared to modern politics. Yet- back then, he resigned the following morning over the affair. The incumbent prime minister described him as "a perfect ass."

Dalton's post-war leak is a droplet when compared to the ocean of budget snippets Westminster has been swimming in for weeks. Coalition budget discussions have not been carried out behind closed doors. They have been testing the waters during these conversations by 'briefing' the press. This is obviously nothing like leaking, which has a completely different name.

So we knew what to expect at lunchtime. Who cares? It was time to get down to business, and although I was personally disappointed the Chancellor didn't opt to use his budget day privilege of drinking in the chamber like so many of his predecessors, the actual statement he delivered was pretty strong. With this morning's announcement that annual government borrowing figures rose above £100 billion in February, it had to be.

He conceded that borrowing had hit a new high, but forecasted that it will fall annually until 2017, when it will reach the low of £21 billion. He insisted that figures predicted the UK would avoid recession, and that one million new jobs would be created over the next five years.

After an unnecessarily confusing debate over the past few weeks, the top rate of tax will gradually be cut from 50p to 45p next year. This cut will be partly funded by what Nick Clegg wants called a "tycoon tax". All that really needs to be known is that the Chancellor has proposed a new top rate of stamp duty of 7% on properties worth over two million pounds, and Nick's jazzy name hasn't caught on. Additionally, Osborne took the opportunity to announce a clamp down on the avoidance of tax, after the controversies of the past few years.

With such a headline-grabbing feature of this year's budget assisting the rich, the government has been incredibly careful to be seen helping families and the poor. Last year the income tax threshold was raised to £7,475. The coalition pledged to gradually raise it to £10,000 by 2015, but with Liberal Democrats keen to speed up the process, so it was today promised that it would be elevated to £9,205 next year. This will leave the average tax-payer with around an extra £200 in their pocket.

The initial proposed alterations to child benefit in a year's time involved any family with an individual earning more than £42,475 losing it all together. The Chancellor has today attempted to soften this blow, by increasing the maximum income boundary above £50,000. Furthermore, this block on benefits will be gradual, falling by 1% for every £100 earned above £50,000. Anyone earning above £60,000 won't receive any child benefits.

It was also just as important to the government that businesses, of all sizes, were kept happy. Corporation tax was already set to be cut to 25% at the start of the next fiscal year, and the Treasury has previous promised to cut it to 23% by 2014. The Chancellor selected to accelerate this to 24% today. Shops will be able to stay open for more than six hours on eight Sundays from July 22nd, to cash in on the predicted Olympic boom. It is hoped that this will give a major boost to the retail sector. Finally, George Osborne seemed to catch political buzzword fever as he assured he would cut 'red tape' and 'regulation', promising this would save hundreds of millions of pounds.

He took the opportunity to reveal that the British exit from Afghanistan in 2014 will save almost two and a half billion pounds before the end of the general election. This money will be partially used to fund accommodation improvements and give further help to families of serving military men and women.

George Osborne argued that the 2012 budget "supports working families" and "backs businesses" whilst "dealing with debts". He endeavoured to get the balance right between supporting high earners to promote British business, and taxing them to raise funds. The BBC's Nick Robinson pointed out that what the Chancellor didn't announce was just as significant as what he did. He failed to alter his approach to fuel duty, ignoring calls from a number of tabloids and prominent e-petitions. However, the way he polished over the controversial smudges on child benefit reforms will be popular, as will his decision to raise the income tax threshold.

This was not enough to appease Labour, though. Ed Miliband declared that "millions will pay more, whilst millionaires pay less". His tone was poor at the outset, and his use of repetition failed to obtain the response that was intended. However, when he picked up pace, few could top his performance. He accused George Osborne of being "out of touch" and awarding "the government's very own bankers' bonus". It took the Leader of the Opposition a long time to get the ball rolling, though. His "hands up" moment, although bizarrely hypocritical, will be repeated for years to come and do damage to the Conservatives. He relied too on quite a poor script, but I've never written this before; at times this afternoon, I was left impressed by Ed Miliband.

As heated as the argument got at times in the Commons, this battle is still going on right now and will continue over the coming days and weeks. The government has to be seen helping the sizable low and middle income earners, whilst getting the economy back on track. George Osborne's message today was that the coalition is full steam ahead with this mission. The opposition's response, however, entirely refuted this. In the eyes of Ed Miliband, the government is disregarding those who need the most help, and the Chancellor's economic strategy is firmly off the rails.